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Var Modelling of Dynamics of Poverty, Unemployment, Literacy and Per Capita Income in Nigeria

Author

Listed:
  • Obalade Adefemi Alamu

    (Assistant Lecturer at Ekiti State University, Ado Akiti, Faculty of Management Sciences, Department of Finance PMB 5363, Ekiti State, Nigeria)

  • Ebiwonjumi Ayooluwade

    (University of Ilorin, Faculty of Physical Sciences, Department of Statistics, PMB 1515, Kwara State, Nigeria)

  • Adaramola Anthony Olugbenga

    (Senior Lecturer at Ekiti State University, Faculty of Management Sciences, Department of Finance PMB 5363, Ekiti State, Nigeria)

Abstract

Research background: Poverty, unemployment, literacy and per capita income are intertwined. However, there seems to be a disconnect between literacy and good living in Nigeria.Purpose: This study investigated the dynamic relationship between poverty, unemployment, literacy and per capita income in Nigeria by examining the impact, shocks and responses among these identified variables.Research methodology: The secondary data on poverty, unemployment and literacy rates were extracted from the National Bureau of Statistics and per capita income was extracted from the World Bank Annual Report. A vector autoregressive (VAR) model of lag order (4) was adopted for the study.Results: The results revealed that poverty rate is an increasing function of unemployment rate and literacy rate and a reducing function of per capita income. The results further showed that dynamics of poverty is affected by shocks in unemployment rate, literacy rate and per capita income.Novelty: Therefore, the study concluded that literacy rate fails as a vital tool for poverty reduction and that the high rate of unemployment results in chronic poverty. The application of VAR to untangle the interrelationship among the variables, without doubt, adds to the literature on the uses of the VAR model.

Suggested Citation

  • Obalade Adefemi Alamu & Ebiwonjumi Ayooluwade & Adaramola Anthony Olugbenga, 2019. "Var Modelling of Dynamics of Poverty, Unemployment, Literacy and Per Capita Income in Nigeria," Folia Oeconomica Stetinensia, Sciendo, vol. 19(1), pages 73-88, June.
    • Handle: RePEc:vrs:foeste:v:19:y:2019:i:1:p:73-88:n:6
    DOI: 10.2478/foli-2019-0006
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    References listed on IDEAS

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    More about this item

    Keywords

    VAR; Poverty; Unemployment; Illiteracy; per capital income;
    All these keywords.

    JEL classification:

    • C01 - Mathematical and Quantitative Methods - - General - - - Econometrics
    • I24 - Health, Education, and Welfare - - Education - - - Education and Inequality
    • I32 - Health, Education, and Welfare - - Welfare, Well-Being, and Poverty - - - Measurement and Analysis of Poverty
    • J21 - Labor and Demographic Economics - - Demand and Supply of Labor - - - Labor Force and Employment, Size, and Structure
    • P43 - Political Economy and Comparative Economic Systems - - Other Economic Systems - - - Finance; Public Finance

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